PROJECT SUMMARY The economic and social burden for the treatment of chronic and infectious diseases is enormous, >$300B. The emergence of drug resistant microbes, the diminishing supply of novel classes of antibiotics, and the dramatic reduction in discovery and development of anti-infective, anti-proliferation and anti-inflammation agents have further amplified public health concern. Fungi are prolific producers of anti-microbial secondary metabolites (SM) and since the turn of the century have provided 45% of bioactive molecules from all microbial sources. However, fungal SM pathways remain largely untapped due to difficulties in efficiently handling and expressing these SM pathways. This research proposal is to advance the science of functional SM metagenomics, to further advance our newly-developed fungal artificial chromosome (FAC) technology, precisely engineer and activate large intact silent SM pathways-containing FAC clones, and to discover novel natural products (NPs) for pharmaceutical and clinical development. Ongoing research at Intact Genomics, University of Wisconsin Madison and Northwestern University have orchestrated key technological breakthroughs that together resulted in the next generation fungal SM discovery platform. This discovery technology combined: 1) an improved methodology for the isolation and purification of high molecular weight genomic DNA from fungi; 2) a new E. coli-Aspergillus shuttle or FAC vector and an A. nidulans host for enhanced expression of cloned large DNAs; 3) a random shear BAC/FAC cloning method to produce unbiased very large insert sizes (>100 kb) for covering the entire set of intact SM biosynthetic gene clusters (BGCs) of a fungal genome (one FAC clone = one intact SM pathway); 4) precisely engineering and activating large intact silent SM gene clusters-FACs by Red/ET techniques and BGC-refactoring via yeast; and 5) a rapid and improved small molecule identification method through both function screening and chemical analysis. In Phase I and ongoing research, we have achieved phenomenal 50~60% compound hit rate by directly transferring fungal genome sequence through FACs first-time. We propose in this Phase II study to further increase the compound hit rate to about 90%. We will also engineer at least 50 silent SM pathways from 7 sequenced fungi (283 SM BGCs) which will be extensively screened for antimicrobial and anticancer agents and insecticides. We expect to uncover >40 novel chemical entities using this approach, and lead candidates with high potency against multiple- drug-resistance bacterial and fungal pathogens, anticancer and insecticide leads. These technologies represent an important advancement for the science of NP discovery in general. In addition, the FACs and compounds produced from this research are a valuable genomic resource that may be screened for other bioactive compounds: for example, antidepressants, antiviral, and anti-inflammatory activities.